Outokumpu Says Rising Costs Neutralize EU Steel Trade Protections

Rising costs for key raw materials and operations are offsetting the benefits of European Union trade measures for Outokumpu, the Finnish stainless steel maker's chief financial officer said Thursday. The company's European business saw only a marginal year-over-year profit increase despite protective tariffs designed to boost regional producers.

Cost Pressures Mount

Outokumpu's CFO, Marc-Simon Schaar, told Reuters that while EU trade policies have increased demand for European steel, they have also inadvertently driven up the price of scrap metal, a primary raw material. Weak end-user demand has simultaneously reduced the generation of scrap, further tightening supply.

In addition to raw material pressures, the company is facing several other headwinds:

• Higher costs for freight, transport, and fuel.
• The expiration of state aid related to EU emissions-trading costs, which previously provided €35 million to €40 million annually.

Ad

Modest Q2 Profit and Import Trends

The company's European division posted an adjusted core profit of €17 million for the second quarter. This marks a recovery from a €13 million loss in the first quarter of 2026 but is nearly flat compared to the €16 million profit earned in the same period a year earlier.

Schaar noted that the immediate impact of the EU's protective measures has not yet met expectations. Steel imports accounted for 17% of European consumption in April and May, an increase from 15% in the first quarter. The CFO suggested that imports likely rose further in June as buyers moved to secure material before tighter trade safeguards were implemented on July 1.